Archive for May, 2008

The house in the May 19, 2008 Forbes article is estimated to cost two billion dollars, has 400,000 square feet and a separate gym for each family member. It is in India and owned by Mukesh Ambani, the fifth richest man in the world.

Obviously money is not the issue. The question is how much house is too much. Yes some people can afford this but how do you rationalize wasting the energy required to heat or air condition 400,000 square feet for one family?

What about Marin County, do families need 20,000 square feet homes? If they can afford it why can’t they have it? No one needs that much space, that’s why. We don’t have the energy to indulge egos. Regardless of construction or energy efficiency no large McMansion is Green and none of them add any value to Marin. I would argue, in the aggregate, they reduce the real value of Marin and the charm that has taken decades to develop.

Too many cute homes in Marin have been torn down to make room for the latest, greatest McMansion. Unincorporated Marin and some Marin cities have enacted a maximum size for new home construction. This is the result of some common sense and a combination of “not in my backyard” or “we don’t need any homes larger than MY McMansion”.

Is there really anything wrong with a family of four living with less than 5,000 square feet? I don’t want to take away from anyone’s success or living standard I am just saying at some point the extra space is more about ego than requirements. Sure, some may realistically use the space, large family, in-laws, home office, etc., and those don’t bother me I just don’t want Marin to be only for the wealthy.

No, this article was not written ten years ago, these are Marin condominiums from Sausalito, San Rafael and Novato all currently on the market with an asking price of less than $200,000. The lower price point has taken a significantly larger hit than the average Marin house.

If you have an interest in looking at this type of investment property let me know.

While I am on the subject of lower priced homes there are 105 condos in Marin priced under $300,000 and what I find interesting is while 31 of those are in escrow the numbers don’t add up to all of them closing. For example for February, March, and April 2008 an average of 3 units per month closed. That would imply we have over 30 months of low priced condo inventory. If you look at the over thirty in escrow the number should be closer to just over three months inventory. So what gives here, is May going to be a super month or are these just not closing? Because I have not been following this statistic I can’t say for sure but when probing a little deeper I find that the vast majority of these condos in escrow are short sales.

In prior post I have written about the large percentage of short sales that fall out of escrow. Part of the reason for this is sellers and listing agents are not always realistic about the asking price. After all, it is the bank that has to agree to take something less than the full loan payoff, they are the one short at the end of the day. I am not defending banks or their prior practices by any streach, just pointing out that short sales fall apart for many reasons; lack of or untimely bank response to offers, and unrealistic asking and offer prices just to name a couple. That being said, I feel if you are willing to put up with what it takes to close a short sale you better have gotten a very good price on the property.